Financial Statements
Angela Evans is a new staff accountant for Denton Chemical Supply. She has asked you to review the financial statements prepared for April to find and correct any errors. Review the income statement and balance sheet that follow and identify the errors Evans made (she did not prepare a statement of owner’s equity). Prepare a corrected income statement and balance sheet as well as a statement of owner’s equity, for Denton Chemical Supply.
Denton Chemical Supply | |||||||||||||
Income Statement | |||||||||||||
April 30, 2010 | |||||||||||||
Revenue |
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Fees Income |
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| 9 | 1 | 5 | 0 | 0 | 0 |
Expenses |
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Salaries Expense |
| 2 | 2 | 5 | 0 | 0 | 0 |
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Rent Expense |
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| 4 | 5 | 0 | 0 | 0 |
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Repair Expense |
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| 7 | 5 | 0 | 0 |
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Utilities Expense |
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| 4 | 2 | 5 | 0 | 0 |
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Drawing |
| 1 | 0 | 0 | 0 | 0 | 0 |
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Total Expenses |
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| 4 | 4 | 2 | 5 | 0 | 0 |
Net Income |
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| 5 | 3 | 5 | 0 | 0 | 0 |
Denton Chemical Supply | ||||||||||||||||
Balance Sheet | ||||||||||||||||
Month Ended April 30, 2010 | ||||||||||||||||
| Assets |
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| Liabilities |
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Land |
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| 3 | 0 | 0 | 0 | 0 | 0 | Accounts Receivable |
| 1 | 7 | 5 | 0 | 0 | 0 |
Building |
| 1 | 0 | 0 | 0 | 0 | 0 | 0 |
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Cash |
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| 3 | 7 | 5 | 0 | 0 | 0 | Owner’s Equity |
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Accounts Payable |
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| 1 | 2 | 5 | 0 | 0 | 0 | Ann Denton, Capital, April 1, 2010 | 1 | 2 | 3 | 0 | 0 | 0 | 0 |
Total Assets |
| 1 | 4 | 0 | 5 | 0 | 0 | 0 | Total Liabilities and Owner’s Equity | 1 | 4 | 0 | 5 | 0 | 0 | 0 |
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